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Firms can create value by
Activity Driver
A factor that influences or contributes to the expense of certain business operations, often used in activity-based costing.
High-volume Product Lines
Product categories within a company that produce or sell in large quantities, typically generating significant portions of revenue.
Cost Distortion
An inaccurate allocation of costs to products, often resulting from traditional costing methods that can overstate or understate the true costs of goods.
Activity-based Costing Systems
A method in accounting that assigns costs to products or services based on the activities that go into producing them, aiming to provide more accurate costing.
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